Lloyds offers Islamic banking

06 October 2005

Lloyds TSB is offering its new Islamic banking service to more customers in London today as yet another branch which offers the service in the city.

Lloyd's TSB in Bethnal Green joins Walthamstow, Edgware Road, Aldgate and Barkingside, as another London branch which offers the service designed to fully comply with Islamic Shariah law, under which Riba, the paying and receiving of interest, is forbidden.

Head of Lloyds TSB Islamic financial services, Paul Sherrin, said: "Bethnal Green is home to one of London's strongest Muslim communities and by bringing Islamic banking to the area we hope to give our customers a real alternative to traditional banking."

The pilot Islamic banking pilot scheme has also been extended to banks in Birmingham, Luton and Dewsbury, Bradford, Slough, Letchworth, and Southampton.

The current account offers no interest and has no overdraft facility, charges no fees and does not require a minimum balance. It does, however, offer customers a debit card.

The home finance product is also in compliance with Islamic Sharia law since it does not rely on interest payments.

Lloyds TSB will buy the home outright, with a ten per cent contribution from the customer.

The customer then repays the outstanding sum over an agreed term.

The Islamic Bank of Britain was the first bank to offer Sharia compliant banking services in the UK.

A spokesperson for the pilot scheme said: "By the end of the year our customers will be able to access Islamic current accounts and home finance in many more branches across the country.

"We're offering products which not only meet the needs of Muslims, but are also truly competitive."